Pentagon cuts military raises and benefits but spends $150 per gallon in green jet fuel

Pentagon cuts military raises and benefits but spends $150 per gallon in green jet fuel
Joint Chiefs Chaiirman Martin Dempsey

The Department of Defense was put in the awkward position of having to defend cuts to military pay raises and housing allowances as well as increasing health care fees just one day before a report saying the Pentagon spent $150 a gallon on green jet fuels, according to a report released Wednesday by the Government Accountability Office:

Specifically, a DOD official reported that the department paid a range of prices from about $3 per gallon for 315,000 gallons of alternative jet fuel derived from natural gas produced using the Fischer-Tropsch process to about $150 per gallon for 1,500 gallons of alternative jet fuel derived from algal oil produced using the HEFA process.

These prices, however, reflect purchases of small quantities of fuel for testing and approval activities, which according to government officials and a fuel producer we interviewed and literature we reviewed, are higher than what the price would be if the quantities were produced at a commercial scale.

HEFA, or Hydroprocessed Esters and Fatty Acids, comes from “renewable oil (e.g., vegetable oils, animal fat, waste grease, and algae oil) … processed using hydrogen treatment (hydroprocessing) to yield a fuel in the distillation range of jet fuel and diesel.”

The product costs about 64 times as much as conventional jet fuel, reports the Washington Free Beacon, which was at about $2.88 per gallon when the story was published. HEFA is not currently produced at a level where it makes economic sense to use the fuel and would require massive subsidies to make it viable in the current market.

GAO said that “alternative jet fuels produced on a commercial scale using the HEFA process would require a subsidy of $0.35 to $2.86 per gallon to be price-competitive with conventional jet fuels in 2020.”

But while the Pentagon is spending huge amounts of money on jet fuels, top military officials testified before Congress on Tuesday about cutting military pay raises and benefits.

Chairman of the Joint Chiefs of Staff Gen. Martin Dempsey said in his written testimony to Congress:

In our deliberations, we collectively assessed how a wide range of compensation proposals would affect our troops at every rank, and over the course of their service. We concluded that we can no longer put off rebalancing our military compensation.

The Joint Chiefs said that the pay and benefits cuts would save the military $31 billion. But if the Joint Chiefs’ proposal is rejected, the military will have to cut another $2.1 billion out of its 2015 budget.

James A. Winnefeld, Jr., Vice Chairman of the Joint Chiefs, took issue with Dempsey’s comments, saying, “Some say we are cutting pay. That’s not true as Chairman Dempsey said. We quickly eliminated any proposal such as reducing the overseas COLA that would do that.

Military.com reported that the “tone of the questions from the Senators Tuesday indicated that the Pentagon’s proposal will also likely be rejected until the results of the commission are issued.”

South Carolina Republican Sen. Lindsey Graham said during the hearing:

We’re having a commission that’s supposed to report back to the Congress here I think next year and I’d like to hear from the committee before we make any real substantial changes.

The military has said it’s needed to rebalance its costs for some time now, but has continued to look for costly “green” alternatives to conventional fuels like oil, gas and coal. In 2012, the Navy got into hot water for using costly biofuels to power some of its ships, which became dubbed the “Great Green Fleet”.

The biofuels used during a 2012 Navy demonstration ran at about $27 per gallon — compared to about $3.50 per gallon for conventional fuels used by the military.

This report, by Michael Bastasch Published, was cross-posted by arrangement with the Daily Caller News Foundation.


LU Staff

LU Staff

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